Abstract:
Since the last decade, customer retention has been a central issue in management, and marketing decisions of firms. This phenomenon is good for the general well-being of the firms. Benefits of customer retention from a different perspective, especially from that of economic, cannot be over-emphasized as they culminate in the overall profitability of firms. The open skies policy in the air transport industry all over the world sparked intense competition and has witnessed a proliferation of airlines into the industry. This reminds us of the deliberate workable strategies aimed at not only acquiring customers, but also keeping them. Several studies have been conducted to identify the relationship between customer satisfaction and business performance in the airline industry but less from the customer retention perspective. The aim of this study was to find out the impact of customer retention in xyz airlines on business performance. In that case customer retention acts as a mediator variable in the model. A quantitative method and survey questionnaire were used to investigate the problem. The survey design was a cross-sectional non-experimental study of 100 respondents which was sampled by using a random sampling technique. Exploratory data analysis and correlation analysis were used.
The analysis of the study clearly exposed that all the six constructs used in the study namely; customer satisfaction, switching cost, price perception, customer loyalty, perceived service quality and customer service are significantly and positively associated with business performance. Despite limitations like generalizability, the findings of this study provide evidence that airline industry professionals are required to work closely with these strategies, especially with Airline Service Quality and Airline Switching Barriers. It is essential to fine-tune the strategies to reflect the exigencies of the time.
